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Predicted climate changes due to greenhouse gas emissions will alter site and ecological conditions, increase instability in many ecosystems and expand the value of forest carbon and wood energy. Woody plants most often are faced with drought stresses, not only because of erratic rainfall, but also the result of climatic changes. Natural variability among wood species in terms of chances in induced water stress in stem moisture content is large. Under severe water deficit, plants have to face the dilemma of dying by drying or being starved of carbon. Changes in the water content of extensible tissues of the stem are readily reversible, causing diurnal variation driven by changing water potential in the xylem. This review intends: 1. to address how stems in woody species play an important role in water storage relevant to plant hydraulics, and 2. to present methodologies to estimate water content in stems of wood species.